2. IT GOVERNANCE SIMULTANEOUSLY EMPOWERS AND CONTROLS Pertemuan ke-1 & 2 Matakuliah: Pengantar IT Governance Tahun: Feb - 2010

3. Bina Nusantara University 3 What is governance & IT Governance What is Governance ? Governance relates to decisions that define expectations, grant power, or verify performance. It consists either of a separate process or of a specific part of management or leadership processes. Sometimes people set up a government to administer these processes and systems.powerperformancemanagement leadership government

4. Bina Nusantara University 4 What is Governance ? (cont.) Corporate and Key Asset Governance

5. Bina Nusantara University 5 What is Governance ? (cont.) The key elements of each asset include : Human assets : people, skills, career paths, training, reporting, mentoring, competencies, and so on. Financial assets : cash, investments, liabilities, cash flow, receivables, and so on. Physical assets : Building, plant, equipment, maintenance, security, utilization, and so on. IP assets : IP product, services and process Information and IT assets : digitized data, information, knowledge about customers, processes performance, finances, IS, and so on. Relationship assets : relationship within the enterprise as well as realtionships, brand, and reputation, and so on.

6. Bina Nusantara University 6 What is IT Governance ? Specifying the decision rights and accountability framework to encourage desirable behavior in the use of IT. IT Governance is a subset discipline of Corporate Governance focused on information technology (IT) systems and their performance and risk management.Corporate Governanceinformation technologyperformancerisk management

7. Bina Nusantara University 7 What is Governance ? IT Governance is the responsibility of the board of directors And executive management. It is an integral part of enterprise governance and consists of the leadership and organizational structures and processes that ensure that the organization’s IT sustains and extends the organization’s strategies and objectives

8. Bina Nusantara University 8 Why is IT Governance needed ? IT has become a major enabler to almost all business transformation initiatives. How IT is being used will have a very important impact on whether the organization achieve its vision, mission or strategic goals.

9. Bina Nusantara University 9 Complementary sides of governance : Behavioral side of corporate governance Normative side of corporate governance

10. Bina Nusantara University 10 Effective IT Governance must address three questions : What decisions must be made to ensure effective management and use of IT ? Who should make theses decisions ? How will these decisions be made and monitored ?

11. Bina Nusantara University 11 The enterprise's challenges and concerns are: Aligning IT strategy with the business strategy Cascading strategy and goals down into the enterprise Providing organizational structures that facilitate the implementation of strategy and goals Insisting that an IT control framework be adopted and implemented Measuring IT's performance

12. Bina Nusantara University 12 IMPORTANT IT GOVERNANCE CONCEPTS IT Principles IT Architecture IT Infrastructure Business application needs IT Investment and prioritization

13. Bina Nusantara University 13 Archetype identifies the type of people involved in making an IT Decision : Business monarchy IT monarchy Feudal Federal IT duopoly Anarchy

14. Bina Nusantara University 14 Governance Arrangements Matrix IT PrinciplesIT ArchitectureIT Infrastructure Strategies Application Needs IT Investment Business Monarchy IT Monarchy Feudal Federal Duopoly Arche type Decision ?

15. Bina Nusantara University 15 IT Governance Design Framework IT Decisions IT Governance mechanisms IT governance arrangements Financial governance HR Governance IP Governance Physical asset Relationship Enterprise Strategi and organization IT organization And desirable behavior Business Performance goals IT metrics and accountabilities

16. Bina Nusantara University 16 Why is IT Governance Important ? Good IT Governance pays off IT is Expensive IT is pervasive New information technologies bombard enterprises with new business opportunities IT Governance is critical to organizational learning about IT Value IT value depends on more than good technology Senior management has limited bandwidth Leading enterprises govern IT differently

17. Bina Nusantara University 17 A few supporting references developed to guide the implementation of information technology governance : Control Objectives for Information and related Technology (COBIT)COBIT The IT Infrastructure Library (ITIL)IT Infrastructure LibraryITIL The ISO/IEC 27001 (ISO 27001)ISO 27001 The IT Baseline Protection CatalogsIT Baseline Protection Catalogs The Information Security Management Maturity Model ISM3 ISM3 ISO/IEC 38500:2008 Corporate governance of information technology.ISO/IEC 38500:2008 Corporate governance of information technology

18. Bina Nusantara University 18 Case study : UPS United Parcel Service (UPS) illustrates how an enterprise can transform IT from a strategic liability to an strategic advantage through effective IT Governance.

19. Bina Nusantara University 19 IT Governance at UPS

20. Bina Nusantara University 20 Governance : Call to action Information : Is increasingly easy to collect and digitize Has increasing importance in products and services Is very hard to value or price Has a decreasing half-life Has increasing risk exposure Is a significant expense in most enterprises